ISIS has finally admitted its leader Abu Bakr al-Baghdadi is dead, according to reports in Iraq.

The terror group is said to have confirmed that the 45-year-old was killed in an air strike in the Iraqi province of Nineveh.

Reports claim ISIS fanatics are scrambling to find a successor to the terror chief, who announced the formation of the group's so-called caliphate in Mosul in 2014.

A ban on jihadis talking about the leader's death has now been lifted, according to a source who spoke to Iraqi media.

If confirmed, his death would mark another devastating blow to the jihadist group after its loss of Mosul, which Iraqi Prime Minister Haider al-Abadi said Monday had been retaken from ISIS after a gruelling months-long campaign.

The Syrian Observatory for Human Rights war monitor said today that it also had information from top ISIS group leaders confirming the death.

'Top tier commanders from IS who are present in Deir Ezzor province have confirmed the death of Abu Bakr al-Baghdadi, emir of the Islamic State group, to the Observatory,' director Rami Abdel Rahman told AFP.

'We learned of it today but we do not know when he died or how.'

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The Pentagon said today that it had no information to corroborate the claims.

'We take any report of this nature with a large dose of salt,' Sebastian Gorka, deputy assistant to President Donald Trump, told Fox News.

'We will verify it. We will look at the intelligence available ... and we will give a statement when we have the requisite facts.'